February 25, 1998
Preston P. Pate, Jr., Director Division of Marine Fisheries
P.O. Box 769 Morehead City, N.C. 28557-0769
Re: Advisory Opinion: Application of the N.C. Environmental Policy Act to development of Fishery Management Plans. N.C.G.S. § 113A-1, et seq.
Dear Mr. Pate:
On January 16, 1998 you requested an advisory opinion concerning application of the N.C. Environmental Policy Act, N.C.G.S. §§ 113A-1 through 113A-13, (NCEPA) to the development of fishery management plans. Your memorandum raised the following questions:
- Does the North Carolina Environmental Policy Act apply to the development of fishery management plans (FMPs) under the Fisheries Reform Act of 1997 (FRA) ?
- Does the NCEPA apply to development and adoption of rules to implement the fishery management plans?
The FRA authorizes the Department of Environment and Natural Resources to develop fishery management plans (FMPs). N.C.G.S. § 113-182.1(a). The FMPs will be planning documents that are not directly enforceable against individuals or agencies. Instead, the FRA directs the Marine Fisheries Commission to adopt rules to implement the FMPs pursuant to Chapter 150B of the General Statutes. N.C.G.S. § 113-182.1(a).
In response to your inquiry, we provide the following advisory opinion. The answer to your question may be summarized as follows:
No. The North Carolina Environmental Policy Act (NCEPA) requires preparation of environmental documents in support of actions involving the expenditure of public monies or use of public lands that may significantly affect the environment of the State. Neither the development of a fishery management plan nor the adoption of rules implementing such a plan is an "action" involving the expenditure of public monies or use of public lands within the meaning of the NCEPA. Therefore, neither the development of a fishery management plan nor the subsequent adoption of rules to implement the plan requires preparation of an environmental document pursuant to N.C.G.S. § 113A-4.
Under the NCEPA, State agencies must report on the environmental impacts of any "action involving expenditure of public moneys or use of public land for projects and programs significantly affecting the quality of the environment of [the] State." N.C.G.S. § 113A-4. The question that you have raised is essentially whether either the preparation of a fishery management plan or adoption of rules to implement the plan is an "action" requiring preparation of an environmental document under N.C.G.S. § 113A-4.
Rules adopted by the Department of Administration pursuant to the NCEPA define "action" to include "licensing, certification, permitting, the lending of credit, expenditures of public monies, and other similar final agency decisions the absence of which would preclude the proposed activity". T01 NCAC 25.0108(b)(1). [Emphasis added.] This definition describes "action" in terms of decisions applying established policy and rules to a specific project proposal.
It is also important to note that the requirement for an environmental document is not triggered by every agency "action" affecting the environment, but only by "an action involving the expenditure of public moneys or use of public land for projects or programs significantly affecting the quality of the environment". Thus, there must be both: 1) an agency "action" (such as permit approval or the location of a new highway corridor); and 2) use of public monies or public land in the project that is the subject of the agency action.
This again suggests that the agency "action" must be distinguished from the project or program requiring public funds or use of public lands. The fact that a state action is publicly funded does not in itself trigger application of the NCEPA; the state action must constitute a final decision on a project that will require either public funding or use of public lands. Consistent with this interpretation, the implementing rules adopted by the Department of Administration pursuant to the Act define "public moneys" to exclude agency resources used solely to process licenses and permits; lend credit; or to provide technical services. T01 NCAC 25.0108(b)(3). This has two implications. First, it reinforces the conclusion that review under the NCEPA is triggered only by a state agency decision affecting a specific publicly funded project (or a project involving use of public lands). Second, it makes clear that executive agency functions alone, even though they are publicly funded, never trigger review under the NCEPA.
As the rule has been applied, a decision by the Division of Water Quality (DWQ) to approve an NPDES permit does not require an environmental document if the permit authorizes a discharge by private industry even though public resources fund both the Environmental Management Commission in its development of rules applicable to the NPDES program and DWQ’s permit review. Although there is a state "action", there are no public monies or public lands involved in the activity that is the subject of the action. By contrast, approval of an NPDES permit for a local government facility requires an environmental document under the NCEPA because the permitted facility is publicly funded.
Executive interpretation and implementation of the NCEPA have consistently made a distinction between: 1) the use of public monies to fund a project that involves use or alteration of the physical environment; and 2) use of public resources to support administrative and policy functions. State agency actions related to activities in the first category require review under NCEPA; actions in the second category do not. Interpretations of a statute by the agency charged with its implementation are generally given substantial weight. See, e.g., Matter of Broad and Gales Creek Community Ass’n., 300 N.C. 267, 266 S.E.2d 645 (1980); Carpenter v. N.C. Dept. of Human Resources, 107 N.C.App 278, 419 S.E.2d 582 (1992). This is particularly true where the interpretation has been followed and acted upon for many years. State ex rel. Utilities Comm’n. v. The Public Staff, 309 N.C. 195, 306 S.E.2d 435, appeal after remand, 320 N.C.1, 358 S.E.2d 35 (1983). In this case, the rule defining "public moneys" to exclude resources used in permitting and other administrative functions has been in place since 1986 and supports a consistent executive interpretation of the statute.
In the history of the state environmental review program (since adoption of the NCEPA in 1971), the Department of Administration has never interpreted the Act to require preparation of an environmental document for a proposed agency planning or rule-making initiative. As discussed above, rules implementing the Act indicate that such policy-making functions do not require review under the NCEPA. Both the statutory language and consistent executive interpretation indicates that the NCEPA requires review only of projects that are publicly funded or use state lands. The development of public policy, whether through a planning process or rulemaking, precedes the "action" that triggers the application of the NCEPA and in itself does not require review under the Act.
As a result, we conclude that rulemaking, as the policy-making phase of state agency decision making, does not require review under the NCEPA. Under the Fisheries Reform Act of 1997, development of fishery management plans precedes actual rulemaking and thus is even further removed from the type of "action" that triggers review. Neither plan development nor rule adoption constitutes a "final agency decision" with regard to a specific project or program involving the use of public monies or public lands. Such policy development likewise does not directly involve use of "public monies" as that term has been defined in T01 NCAC 25.0108(b)(3).
We would also note that the Administrative Procedures Act (APA), Chapter 150B of the General Statutes, imposes notice and hearing requirements on agency rulemaking. The APA rulemaking process provides the public with both information on proposed rules and an opportunity to comment prior to final adoption. In this regard, the APA provides a process for public participation in rulemaking comparable to the public review opportunities that are afforded by the NCEPA with regard to specific project decisions.
Thank you for your inquiry. Please advise us if we can be of further assistance.
signed by:
Daniel C. Oakley Senior Deputy Attorney General
Robin W. Smith
Assistant Attorney General
cc: Daniel F. McLawhorn Chrys Baggett